The Industrialisation of Germany and the Advent of Liberalism
As the Zollverein reduced barriers to trade among the German states, the industrialists of the Rhineland, Westphalia, Brandenburg and Schleissen, the principle industrial regions in Germany at the time, began to steadily increase their wealth. The Prussian administration of Frederick William III was keen to emulate the success of the British industry, then considered the workshop of the world, and believed that a key ingredient was the relatively independent captains of industry.
Frederick, in discussions with his ministers, agreed a four pronged industrial strategy which aimed to make Prussia the pre-eminent economic power on the continent. Firstly, steps would be taken to drastically improve the administration in new acquired Rhenish provinces, as well as throughout the Schleissen where state resources were focused on the integration of the Polish minority. The expansion of the state bureaucracy was aimed at securing a firm understanding of local infrastructure needs, establishing a solid relationships with those who held the wealth in these areas, and seeking to encourage a more efficient extraction of resources, particularly coal, and to ensure that the necessary apparatus was in place to encourage the expansion of the urban population.
The Ruhr was the centre of early German industrialisation in the late 1830s
The second part of the strategy, and perhaps the most transformational, was the rapid expansion of the fledgling rail network. Initially, the proposal was to create two large loops, one in the east centred on the city of Berlin, and one in the west taking in the expanding industrial towns of Dortmund, Mainz, Aachen and Cologne. These rail networks would be among the largest on the continent, and even rival the rapidly growing networks in the British Isles. Herr von Bodelschwingh, the new Prussian finance minister, had far great ambitions. Persuading the Kaiser that a Prussian funded rail across north Germany would bring huge economic benefits, and also significantly strengthen the Prussian diplomatic situation among the north German states, he pressed for the most extensive rail network in the world to be constructed. Frederick William III, eager to seize the opportunity to displace Austrian influence in Saxony, and draw Hanover and Schleschwig Holstein closer to the Prussian sphere of influence, was easily persuaded and soon the largest infrastructure project in German history was underway.
In the few years since the Zollverein had expanded across the region, the small German states had come to admire the efficiency of the Prussian administration, and to accept the huge economic benefits of closer integration. The development of a truly German railway excited passions, and found massive popular support, not least among the industrialists who quickly saw that such a development could vastly reduce their transportation costs, and expand the market their products could reach.
An oil painting by Adolf Friedrich Erdmann von Menzel from 1847 showing a train on the Berlin-Potsdamer Bahn
In March 1839, the Prussian state unveiled details plans to rapidly lay rail networks across much of their territory. After discussions with the Zollverein members, it was agreed that the Prussian state would also offer interest free loans to cover the upfront costs throughout the North German states, connecting the rail network in the Ruhr with that in the Prussian heartlands. It would take several years for the network to be built, and the smaller German states remained responsible for the accumulation of the raw materials for the construction, but the huge capital costs could not have been met without the Prussian investment. Railroads and a common tariff were the two economic reformers which bound the German states increasingly to Prussia, while Austria’s protectionism was simultaneously lessening her grip on the southern and central German states.
The ambitious plans to establish a truly German rail network
As well as funding the development of the railways, Kaiser Frederick William encouraged technological advancements to support the more efficient extraction of resources. German coal production increased rapidly in the years following 1830. Germany had the natural resources, the slowly increasing urban population and the favourable political environment, but lagged behind Britain in terms of the crucial capital accumulation. Frederick William encouraged favourable tax arrangements to encourage the number of capitalists and investment institutions. In 1830 there had been less than 100 capitalists in the whole of Germany, but by 1839 there were over 2,000 in Prussia alone.
Liberalism
The ideas of liberalism were first introduced into Germany by the French guns and muskets during the Napoleonic wars. It was not an entirely imported ideology, however. The 1808 Städteordnung reforms, passed as part of the response to Napoleons rapid triumph over Prussia and the need to raise the French indemnity. These reforms created the first municipal political representatives and gave towns a relative degree of autonomy. These positions, particularly in the more industrial towns of the Rhineland, proved attractive to the fledgling liberal organisations.
Another focus of liberal activities was the university towns and the younger student population. The industrialisation of the 1830s brought more people into the increasingly liberal towns, and the new emerging captains of industry were naturally disposed to favour a more liberal constitution. Frederick William took advantage of the increasing revenues of the state to pass on significant tax savings to the upper and middle classes in a bid to head off demands for greater political representation, and also to encourage private investment. Nevertheless, with fewer than 20% of upper house representatives being liberal, and with large divides existing between the various factions, the pressure for reform was still relatively minor.
International Developments
Prussia, after establishing a small colony on Nigerian coast, began to advance at the expenses of the small tribes who held sway in the region. Soon there were almost 1 million who were part of the Prussian Empire. Supplies of tropical wood boosted the coffers of the state, and encouraged increasing trade in luxury furniture. The British, French and Dutch, who all controlled small trading posts west of Nigeria, carefully monitored developments, and began to grow concerned about the pace of Prussian expansion. France, initially happy that Prussia was to be distracted from European affairs, began to fear that their alliance had created a new colonial rival. However, the continuing instability in the Low Countries soon became the focus of Great Power attention. The uneasy truce had left much of the southern Netherlands in the hands of the Belgian rebels. Amsterdam was determined to reassert her control over the entire region, but the large Dutch population in rebel hands was a particular source of embarrassment. Their quest to secure international support for fruitless however, and by 1839 the two countries once again seemed to be on the brink of open warfare. A congress was organised in London to attempt to establish a general agreement not to intervene among the Great Powers.
In Germany, the states took little interest in the Low Countries crisis. Austria had long since given up any hope of reclaiming the southern Netherlands, while the Prussians were deterred by the steely opposition of France and Britain to any Great Power making gains. More interesting for the German Confederation was the decision by Great Britain to formally sever ties with the Kingdom of Hanover. The royal ties would of course remain, but politically Hanover would now be an independent state. The British would cease any participation in the German Confederation. Prussian economic overtures and diplomatic attention was soon focused on the new Kingdom, aiming to secure mastery of Hanover and effectively stitch up all of the North German states in the Prussian sphere of influence.